Love and taxes: how to file as a couple

You’ve shared a long strand of spaghetti at dinner, you’ve cuddled for hours watching Netflix, you’ve seen each other pee and then you decided to tie the knot. But we live in a society that upholds the individual, not the collective.

It doesn’t matter how close you are as a couple, if you sometime shag on a Thursday evening, if you live together, if you’re married — you must always file an individual tax return. That tax man isn’t a romantic!

If you’ve been living with your romantic partner for more than 12 consecutive months by Dec 31, the tax-man insists you file a return as a common-law couple. (each Government agency, along with your parents, make up their own terms for when you’re common-law )

Again, this doesn’t mean you file ONE return or that you have to go together to file it, it just means you have to fill out his or her information (SIN, income, etc.,) on your tax return and you get a few new perks/minuses:

The gov’ combines your net incomes to see if you meet the definition of a low-income family. You probably won’t meet this threshold anymore, which hovers around $34, 000 per household. If you do meet this threshold then only ONE person gets to claim it. And to think your biggest fight before this is who left the toilet seat up!

Like many expenses that you can deduct from your income, it makes sense pass medical expenses off to the lower-earning partner. You’re entitled to the max. credit after spending about $2100 or 3% of your income — easier to reach when you’re making less.

You didn’t marry rich, but that’s okay! If you’re partner is making a shit income, the working partner may be able to claim a spousal credit. Since the first $10, 800 or so are tax free (how generous CRA!) if your partner is making less than that, you can double that figure and get about $21, 600 tax free! Woo hoo. Go marry a grad student now!

If you married a smarty-pants, or a bum that’s been writing their thesis for 15 years, it’s okay. They can transfer any unused tuition credits to the higher-earning/working spouse!

Doesn’t all of this sound like you’ll have to TALK to your partner about money? Does that seem hard and scary to you? To file as common-law, after all, which you’re legally required too if you meet the definition, you have to find out exactly how much your partner makes. Yesh. Let us talk you through it! Our Budget with Your Boo Coursewill tell you EXACTLY how to sit down with your partner and have this conversation. It will also help you figure out the questions you need to ask and lots of goodys to see if you’re financially compatible.